Malwarebytes, Started by Teenager, Raises $30 Million to Battle Malware

Ten years ago, when Marcin Kleczynski was 14, he accidentally infected his parents’ computer while looking for a key generator for a videogame. The computer had antivirus software from a major vendor already installed.

Malwarebytes Chief Executive Marcin Kleczynski

Malwarebytes

Mr. Kleczynski was surprised, but being “helpless and jobless,” he said, he couldn’t afford to take the computer to a specialist to get it fixed.

So he started searching on Google for the computer’s symptoms, eventually running across a spyware website staffed by volunteers who helped him fix the computer after three days of going back and forth.

The incident sparked Mr. Kleczynski’s interest in computer security. He started by writing free software tools in Visual Basic that would have made his parents’ computer easier to fix. He met Bruce Harrison, who worked at a tech shop and critiqued Mr. Kleczynski’s tools.

Mr. Harrison knew so much about computer security that Mr. Kleczynski at first thought he was “working for the bad guys,” he said. Even though Mr. Harrison was “a middle-aged man” and Mr. Kleczynski was still a teenager, the two in 2008 started a security company, Malwarebytes Corp., which Mr. Kleczynski ran out of his dorm room at the University of Illinois.

Profitable from day one, according to Mr. Kleczynski, and now with more than 60 million people per quarter using Malwarebytes to protect their computers, the company has raised $30 million in Series A funding from Highland Capital Partners. Valuation wasn’t disclosed.

Malwarebytes has turned away several potential acquirers over the years, according to Highland Partner Corey Mulloy, and last year made an acquisition of its own, San Jose, Calif.-based ZeroVulnerabilityLabs Inc.

In March, Mr. Kleczynski hired a chief financial officer, Mark Harris, who has overseen funding rounds, an acquisition and an IPO in previous jobs.

“We went after infections and helped remove them, [infections] that big antivirus companies couldn’t tackle, and that has evolved tremendously,” Mr. Kleczynski said. “This round of fundraising will help us grow faster.”

Malwarebytes takes advantage of the fact that cybercriminals have learned to create malware faster than some antivirus vendors have learned to detect it. Since the Malwarebytes team was so small, they had to learn to be creative, Mr. Kleczynski said, developing new techniques to detect and remove malware that is now capable of morphing by the second into something new. The company updates parts of its software 15 times per day.

Mr. Kleczynski said he talked to 30 or 40 venture capitalists over the last year or two, and the partners at Highland “were far more personable than the others.”

Mr. Mulloy said Mr. Kleczynski could be afford to be choosy about investors because he didn’t need the money. However, growth has increased over the last quarter or two because Malwarebytes users have started to introduce the software at work, and companies are now using it. Some security vendors are also using it internally, Mr. Mulloy said.

The new money will be used to double the size of Malwarebytes’ workforce from about 40 to 80 people, keep developing the products and develop new security technology for mobile devices.

“All doors are open” for Malwarebytes, said Mr. Kleczynski, who graduated from college and has moved from Illinois to San Jose, where the company is now based. Malwarebytes could someday go public, continue to buy companies or get acquired itself.

As part of the funding, Mr. Mulloy and Highland Partner Jeremiah Daly join the board. Malwarebytes is also looking for independent board members with expertise in computer security, Mr. Mulloy said.

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